Agenda and minutes

To remind Members of the need to record the existence and nature of any personal, disclosable pecuniary or other registrable interests in items on the agenda, in accordance with the Members’ Code of Conduct.

The Monitoring Officer, Sarah Clarke, advised that all Members had completed an application for a Grant of a Dispensation in relation to any beneficial interest in land within the Authority’s area. The dispensation was granted to allow all Members to speak and vote on the budget items. A number of personal interests had been declared in relation to the agenda items, they had been published on the website and were on display on the door of the Council Chamber. Also included in the minutes as follows:

Members of the Executive to answer questions submitted by members of the public in accordance with the Council Procedure Rules contained in the Council's Constitution.

A full transcription of the public question and answer session is available from the following link: Transcription of Q&As.

Purpose: to set out the financial planning assumptions for future years and align these with the Council Strategy to ensure that the Council Strategy will be delivered. The MTFS highlights the overarching key issues facing the Council’s finances as well as how there are many different scenarios and uncertainty concerning the future revenue streams for the Council in the future.

The Council considered the report (Agenda Item 4). The Medium Term Financial Strategy (MTFS) set out the financial planning assumptions for future years, these were aligned with the Council Strategy to ensure that Council Strategy would be delivered. The MTFS highlighted the overarching key issues facing the Council’s finances as well as the fact that there were many different scenarios and uncertainty concerning the future revenue streams for the Council.

MOTION: Proposed by Councillor Iain Cottingham and seconded by Councillor Jeff Brooks:

That the Council:

“approve the Medium Term Financial Strategy”.

Councillor Cottingham stated that the MTFS was a very important document for the Council in setting out the financial plan for the next four years. It provided a direction of travel for the Council to achieve greater financial resilience.

The forecasting of financial performance over an extended timeframe was challenging, particularly in a time of financial uncertainty.

The finances of local government were a concern nationally. The results of a recent local government survey showed that a high proportion of Council Leaders were concerned about financial stability. One in ten respondents felt there was a risk their local authority could go bust in the next year. Approximately half of those responding felt this could happen in the next five years without additional funding.

Post the 2023 local elections, the Executive considered the Q1 financial performance reports. The projected revenue overspend at that time was £8m (in excess of the General Reserves at that time). Radical action needed to be taken and much hard work was put in place to strengthen financial controls. This included the formation of the Financial Review Panel (FRP) which reviewed expenditure in excess of £2k. This approach had helped to reduce the overspend to £3.3m.

In was the intention, over the period of the MTFS, to replenish General Reserves by £6m to improve the Council’s financial resilience. This would require annual Council Tax increases of 4.99% (2.99% Council Tax and 2% Adult Social Care precept).

These steps were also necessary to help meet increasing Adult Social Care and Children’s Social Care costs and because of the inadequacy of Central Government funding.

Councillor Ross Mackinnon noted the introduction of the FRP to tighten controls, but then referred back to debate at the 19 December Council meeting and the proposal from the Administration to withdraw the Local Plan. The Government stepped in to prevent this from happening. Had it been withdrawn then the Council would have incurred costs in the region of £2m. He therefore considered that the Administration was not in a position to raise concerns with regard to the budget.

Councillor Tony Vickers was pleased to note that the Council would be continuing with the Municipal Bond scheme giving home owners who could afford it the opportunity to invest in schemes to help the wider community such as the solar farm.

Councillor Brooks responded to the points raised by Councillor Mackinnon. The Liberal Democrat Administration inherited financial difficulties from the previous Administration and  ...  view the full minutes text for item 73.

Purpose: The report seeks to consolidate the investments and borrowing strategy for the year ahead by detailing how and where the Council will invest and borrow in the forthcoming year, within a particular framework. This strategy is monitored throughout the year, with a mid-year report going to the Governance Committee as well as an annual report being presented to Members.

The report also has a statutory footing under the Local Government Act 2003.  The Council must have an approved (by Full Council) Investment and Borrowing Strategy (or similar) for the forthcoming financial year. The Council is also required to comply with other regulatory requirements as highlighted in this report, for example to be a professional investor the Council must have £10 million of liquid investment funds on average during the financial year; the Council must also detail its compliance with the relevant Treasury Management indicators (as highlighted in this report).

The Council considered the report (Agenda Item 5). The report sought to consolidate the Investments and Borrowing Strategy for the year ahead by detailing how and where the Council would invest and borrow in the forthcoming year, within a particular framework.

The report also had a statutory footing under the Local Government Act 2003. The Council must have an approved (by Full Council) Investment and Borrowing Strategy (or similar) for the forthcoming financial year. The Council was also required to comply with other regulatory requirements as highlighted in this report.

MOTION: Proposed by Councillor Iain Cottingham and seconded by Councillor Jeff Brooks:

That the Council:

“agree and adopt the proposed Investment and Borrowing Strategy for 2024/25;

agrees the revised Commercial Property Terms of Reference in Appendix D; and

agrees that the capital receipts generated from disinvestment are applied to offset potential future financing costs or are utilised as part of the flexible use of capital receipts policy.”

Councillor Cottingham made the point that the current financial climate was one of unprecedented risk. It was therefore crucial to manage funds in a prudent and risk averse way. The Strategy set out the borrowing and investment plans for the Council. Officers in the Treasury Team managed these plans and followed a rigorous process of risk management in doing so.

Borrowing was one of the avenues used to fund the Capital Strategy and the current borrowing strategy was for shorter term borrowing as this achieved lower rates of interest at the present time. Capital receipts also funded the Investment and Borrowing Strategy, and the investment of those funds helped to reduce borrowing and associated costs.

As mentioned by Councillor Tony Vickers, Councillor Cottingham was pleased that the Municipal Bond would be relaunched in 2024/25 to help fund the solar farm.

The Council was evaluating the potential to borrow from the UK Infrastructure Bank as the cost of borrowing was less than that available from the Public Works Loan Board.

The Council’s borrowing costs for 2023/24 were in the region of £168m, this was expected to reduce to £164m by 2027/28.

Councillor Cottingham concluded by stating that the Section 151 Officer was confident that this Strategy would provide an effective, robust and prudent platform to support the Capital Strategy.

Councillor Ross Mackinnon noted the points made on risk aversion. However, he questioned if the Administration was clear on its plans for commercial property investment following a recent meeting of the Executive when amendments were sought to the Property Investment Strategy. The decision taken on the Strategy was called-in and it transpired that this was not a decision for the Executive to take. The Property Investment Strategy had since been amended with disinvestment planned over the longer term.

Councillor Mackinnon made reference to paragraph 5.17 of the report which outlined that the Executive could invest funds of up to £17.5m in real estate investment trusts with the aim of achieving rental income. He noted this would be a continuation of property investment and  ...  view the full minutes text for item 74.

Purpose: to outline the Capital Strategy covering financial years 2024 - 34 and the supporting funding framework, providing a high-level overview of how capital expenditure, capital financing and treasury management activity contribute to the provision of local public services along with an overview of how associated risk is managed and the implications for future financial sustainability.

The Council considered the report (Agenda Item 6) which outlined the Capital Strategy covering the financial years 2024 - 34 and the supporting funding framework. The report provided a high-level overview of how capital expenditure, capital financing and treasury management activity contributed to the provision of local public services along with providing an overview of how associated risk was managed and the implications for future financial sustainability.

Decisions made on capital and treasury management had financial consequences for the Council for many years into the future. Decisions were therefore subject to both a national regulatory framework and a local policy framework.

MOTION: Proposed by Councillor Iain Cottingham and seconded by Councillor Jeff Brooks:

That the Council adopt the following recommendations:

“That the Capital Strategy and supporting Capital Programme for the period 2024 -2034 is approved (Appendix A).

That the Council approves the Minimum Revenue Provision (MRP) statement for 2024/25 and the revised MRP policy for 2023/24 (Appendix C). 

That the Flexible Use of Capital Receipts Policy (Appendix D) is approved.

That the proposed CIL (Community Infrastructure Levy) Bids be approved for inclusion in the Capital Programme (Appendix E).”

Councillor Cottingham was proud to be proposing the first West Berkshire Council Capital Strategy for a Liberal Democrat Administration since 2005.

The Strategy proposed the investment of £330m across the district over the next ten years. The key areas of investment aligned with the Council Strategy and included £123m towards a prosperous and resilient district, £145m for a fairer West Berkshire with opportunities for all, and £28m to help tackle the climate and ecological emergency.

The Strategy would be supported by £140m in Council borrowing which was within prudent limits.

For 2024/25, £53m would be invested across West Berkshire. This included £10.5m in Education, £4m on highways, as well as investment in biodiversity and active travel schemes. The final stage was being entered for the Thatcham Flood Alleviation Scheme and a Bus Service Improvement Plan would be implemented.

Further details would follow from individual Portfolio Holders.

A key element of the Strategy was the flexible use of capital receipts. The Government had advised local authorities to minimise risks with property investments and the strategic approach with the Council’s property advisors was to disinvest in order to deliver best value to residents.

Councillor Cottingham made clear that the disposal of assets, particularly buy to let properties, was not a ‘fire’ sale. This was currently a common approach in the property market. He reiterated that receipts would be reinvested to benefit residents.

Councillor Cottingham concluded by advising of a technical accounting change to the Minimum Revenue Provision that would allow the Council to adjust its process for meeting the costs of borrowing as it was considered overly prudent. This was with the Council’s external auditors for validation.

(Councillor Geoff Mayes joined the meeting remotely at 6.20pm).

AMENDMENT: Proposed by Councillor Carolyne Culver and seconded by Councillor Adrian Abbs:

Original text: Falkland Primary School – Classroom replacement budget

Proposed amendment: “Move £2m  ...  view the full minutes text for item 75.

Purpose: Full Council must set a balanced budget for the 2024/25 year ahead by the 11^th March 2024. This is to ensure that the Council has the resources set aside to achieve its objectives and to ensure that Council Tax bills can be issued to residents across the district before the start of the new financial year. This report details the budget proposals for the year ahead that form the basis of the 2024-25 revenue budget and detail the respective Council Tax proposals and resolutions.

The Council considered the report (Agenda Item 7). Full Council must set a balanced budget for the 2024/25 year ahead by the 11 March 2024. This was to ensure that the Council had the resources set aside to achieve its objectives and to ensure that Council Tax bills could be issued to residents across the district before the start of the new financial year. This report detailed the budget proposals for the year ahead that formed the basis of the 2024-25 Revenue Budget and detailed the respective Council Tax proposals and resolutions.

The report included various appendices to support Members in the decisions before them. In advance of this budget paper the Council had run a budget consultation exercise (further information in Appendix J) where, following a meeting of the Executive on the 23 November 2023, a range of proposals had been consulted upon. Other appendices to the report included the overall savings proposals, budget investment, fees and charges, and changes and items relating to the setting of Council Tax. There were appendices on levels of reserves, which were particularly important for this Revenue Budget given they were forecast to be below the minimum level set by the s151 officer.

MOTION: Proposed by Councillor Iain Cottingham and seconded by Councillor Jeff Brooks:

That the Council:

“Approves the 2024-25 Council Tax requirement of £124.2 million, requiring a Council Tax increase of 2.99% with a 2% Council Tax Precept ring-fenced for adult social care.

Approves the Fees and Charges as set out in Appendix G and the appropriate statutory notices be placed where required.

Approves the Parish Expenses of £18,510 as set out in Appendix H.

Note the following amounts for the year 2024-25 in accordance with regulations made under Section 31B of the Local Government Finance Act 1992, as amended (by the Localism Act 2011):-

(a)      67,867.50 being the amount calculated by the Council, (Item T) in accordance with regulation 31B of the Local Authorities (Calculation of Council Tax Base) Regulations 1992 (as amended by the Localism Act 2011), as its council tax base for the year (the number of properties paying council tax).

(b)      Part of the Council’s area as per Appendix K being the amounts calculated by the Council, in accordance with regulation 6 of the Regulations, as the amounts of its council tax base for the year for dwellings in those parts of its area to which a Parish precept relates.

Calculates that the Council Tax requirement for the Council’s own purposes for 2024-25 (excluding Parish precepts) is £124,203,641.

Notes that the following amounts be now calculated by the Council for the year 2024-25 in accordance with Sections 32 to 36 of the Local Government Finance Act 1992, amended by the Localism Act:-

(a)      £408,064,670 being the aggregate of the amounts which the Council estimates for the items set out in Section 31A(2), (a) to (f) of the Act taking into account all precepts issued to it by Parish councils.

(b)      £284,963,208 being the aggregate of the amounts  ...  view the full minutes text for item 76.